Nova Scotia court awards 12 months' notice plus $15,000 in aggravated damages
“If you're going to discipline an employee in a way where you're setting them off work, it’s important to give them fair notice of why you're doing it, what the expected timeline is, and, ideally, set up your contract to allow you to do that.”
So suggests Geoff Breen, chair of the Employment and Labour Group at Cox & Palmer in Halifax, after the Nova Scotia Supreme Court found that a seasonal worker who was sent home and not recalled for several weeks did not resign and was instead constructively dismissed.
“If you read between the lines in the decision, the worker wasn't necessarily an angel in the way he talked to some people, but the employer was held to a higher standard of acting respectfully,” says Breen.
The worker, 43, was a seasonal labourer with Elmsdale Landscaping Limited (ELL), a landscaping company based in Elmsdale, N.S. He was hired in 2003 and he was typically offered work in June and received a layoff notice in December. He then received employment insurance (EI) benefits until he was recalled in the spring.
The worker’s duties usually involved cutting sod and loading pallets with sod. He received an hourly rate of pay plus a bonus related to the number of sod pallets loaded.
In July 2017, the worker was suspended for two days without pay after an argument with ELL’s owner. ELL’s management felt that the worker’s attitude could sometimes be troublesome, although that was the only disciplinary action.
On June 4, 2020, ELL’s vice-president (VP) texted the worker to remind him to clean up any broken pallets at the sod field. The worker said it was “fairly clean,” but he and three other employees continued working on it.
Later that evening, the VP texted him to say that the owner and his wife were cleaning up the site. She said that the owner was angry and that the worker should stay home the next day.
The worker was surprised, as the other employees had not been told to stay home. He texted that he thought that he was doing what was right and not sending out “crap sod.”
On June 7, the VP texted the worker that his supervisor wasn’t returning to the sod field, so he should remain home. The worker protested, but she said that the owner was still angry. A testy exchange ensued.
On June 8, the worker was offered work as a sod layer, but this would mean he wouldn’t receive the sod pallet bonus. He didn’t refuse, but he wanted to know the reason for the perceived demotion.
The owner called shortly thereafter and, according to the worker, called him the “worst employee” and “bad with money,” and his lack of care on the site would cause an accident. The worker felt ashamed and embarrassed.
The worker texted the VP to accept the sod-laying assignment, but she said that the owner didn’t want him going with another employee who was assigned that day. She added that someone would get the company truck from him and the worker asked if she was firing him. The VP replied that the owner didn’t want him in the sod field and the worker didn’t want to work with the other employee there.
The worker responded that he felt he had been bullied and he didn’t say he wouldn’t work with the other employee. Nine days later, he filed a labour standards complaint indicating that he wasn’t sure what his employment status was.
By June 19, the worker hadn’t heard from ELL, so he assumed that he had been fired. He requested that the VP sign a document allowing him to withdraw his company-held RRSP, but she took this as his resignation.
ELL issued a record of employment (ROE) on June 29 that stated the reason for ending his employment was “shortage of work/end of contract or season.”
There’s a fine line between suspending non-unionized employees and constructive dismissal, according to an employment lawyer.
It’s always risky to suspend an employee without pay without an express contractual right to do so, says Breen.
“Even if there is clear communication as to why you're doing it, demonstrating reasonable ground is a serious issue,” he says. “And then once the person is sent home, failing to update them in a timely manner is a problem.”
In late July, ELL was informed of the labour standards complaint. It wrote to the worker to clarify that he had been temporarily laid off due to a shortage of work.
On Aug. 9, ELL contacted the worker with a recall offer but he didn’t respond. The VP followed up with a text saying to let her know if he was refusing, and the worker responded that the owner’s comments and the fact that they weren’t offering his original job made him feel like he wouldn’t be recalled, so he found new employment.
The worker filed a claim for constructive dismissal and bad faith in the manner of his dismissal.
Constructive dismissal test
The court noted the two-part test for constructive dismissal – whether there was a breach in an express or implied contract term, and whether the breach was “sufficiently serious to constitute constructive dismissal.”
The court found that the worker was in a weak bargaining position as he was a seasonal labourer who hadn’t completed high school and was non-unionized. As a result, there could not be an implied term of agreement allowing an indefinite unpaid suspension as a disciplinary measure, said the court.
This meant that the “immediate decision” to tell the worker to remain at home without pay for an indefinite period of time was not justified, said the court.
In addition, the worker was told that the owner didn’t want him back performing the work in the sod field and he didn’t hear anything from ELL for two weeks. When he asked for his RRSP, ELL did not question it and assumed that the worker was resigning, said the court.
The court also found that it didn’t make sense for ELL to send the worker a letter confirming his layoff in late July if it had assumed that he had resigned one month earlier.
The court determined that it was reasonable for the worker to conclude that ELL did not want him to continue, as the company did not indicate in a timely manner any intent to continue the employment relationship. Combined with the owner’s angry phone call, a reasonable person would assume that the worker was dismissed, the court said.
The court also found that the worker took reasonable steps to look for other employment after two months of “mixed signals” from ELL, as evidenced by the fact that he had found a new job when the company finally contacted him on Aug. 9.
“A constructive dismissal is basically the employer intending not to be bound by the employment contract, so sending someone home without paying them, arguably, could be enough to trigger it,” says Breen.
“It’s normally the duty of an employee to mitigate by coming back to work when they're recalled, but because they had treated him poorly, yelled at him, and left him in the lurch for so long, it was deemed that it was reasonable for him to say [he wasn’t coming back].”
“[The worker] was vulnerable with relatively low training and education, so for him to just sit hoping to get a callback – he obviously needs to earn a living,” adds Breen.
12 months’ notice, aggravated damages
The court found that the worker was entitled to 12 months’ reasonable notice – encompassing the remaining seven months of the 2020 landscaping season and five months until the beginning of the next one. Although he was a seasonal worker, he had “an implicit agreement” with the company that he would be recalled each spring, said the court.
The court also found that ELL acted in bad faith, with the owner’s phone call creating anxiety for the worker and using “intimate, personal knowledge” of the worker to make the “bad with money” comment. It also tried to circumvent the worker’s rights by trying to confirm that he was on layoff after assuming he had resigned, the court said.
“[In addition to the suspension], calling and telling him he’s bad with money and the worst employee, is the icing on the cake,” says Breen. “And then saying, ‘We actually laid him off for lack of work,’ which is clearly not the case.”
In addition to pay in lieu of 12 months’ notice, ELL was ordered to pay the worker $15,000 in aggravated damages.
See Hiltz v. ELL Landscaping Ltd., 2022 NSSC 243.